In the second quarter of 2021, HP Inc. reported $3.3 billion earned in toner supplies sales alone, with close to $1 billion of that as profit (in the supply/printer segment). That revenue was earned over 90 days. How much of that revenue is your dealership on pace to capture from them in Q3?

Managed print services (MPS) remains the biggest opportunity for growth at your company. Are you fully capitalizing on it? If you’re not satisfied with your progress, this article will help you right the ship. There’s always time to improve. HP Inc increased its supply sales 17% last quarter. You can too!

It starts with understanding where we could be missing the mark. Here are five reasons your MPS strategy isn’t working and how to fix it.

Reason 1: There’s no clear training around qualifying

Qualifying opportunities is a baseline sales skill. It’s how we can determine if an account is a good opportunity or not to pursue. When it comes to the hardware, every account could be an opportunity. As long as they are printing, we can sell them something, right? With MPS it’s not explained with the same level of clarity.

The way we are taught to find a good MPS opportunity is to look at the number of desktops an office has. If the account has 20 or more printers, full speed ahead! 10 to 20 printers “depends” and under 10 could be a waste of time. Hey, but you still have the copiers to target! This couldn’t be more unclear and it couldn’t be more wrong.

MPS is really all about volume. Your dealership has a choice. Do you want the customer to pay you for printing on any of their printers, regardless of the number of printers they have, or do you want to give that business to HP? The money is there and being spent daily.

The truth is, every account is an MPS opportunity, regardless of size. Your salespeople are stepping over profitable service contracts 10 times a day, and instead trying to fight to win a highly competitive copier sale with dwindling margins.

YOUR SOLUTION: Train them on how to qualify the true MPS opportunity

Reason 2: MPS objection handling is missing

Objection handling is one of the most common sales training topics. “I’m not interested,” “I’m too busy to meet,” “we already have a vendor that handles that for us,” and “send me some information” are the big four that should be practiced regularly by our sales teams.

But how often is there a sales training on the various objections you get with MPS? Hardly ever. That’s crazy when you think about it, right? Our salespeople need to be prepared to hear these or you can kiss your prospects goodbye. There are three main objections your salespeople will get when trying to sell MPS.

MPS Objection 1: “We don’t want to use remanufactured toner. We prefer to use OEM.”

Why does the customer want to use OEM? What experience have they had in the past with remanufactured toner? When was the last time they tested out a remanufactured toner? Do they realize that some remanufactured toner providers go through great lengths to ensure their toner has lower failure rates than even HP OEM? It’s true.

MPS Objection 2: “We aren’t spending that much on our desktop printers.”
How much are they spending? How are they currently tracking their cost per page on their various printing devices? What has their analysis told them about their cost to print on their desktops? How are they certain they couldn’t be getting more value for what they spend by using a MPS service? The truth of this objection is that your prospect has no clue whatsoever about how much they are spending. How can your salespeople be better at opening their eyes to this reality?

MPS Objection 3: “We don’t use our desktop printers that much. We send almost everything to the copier.”

How much are they printing on their desktops? How are they tracking this number on a monthly basis? In what situations might they print more to their desktops? What function do their desktops have at their organization if they don’t use them? This objection is just like the one before about cost: the prospect has no idea about their volume. Who tracks volume? Do you know exactly how much you print to the printer next to your desk or the printers in your office? Probably not. Why would we expect our customers to be any different? How could your salespeople help your prospects see the danger in overusing such a costly device?

YOUR SOLUTION: Train them on how to be comfortable with these common MPS objections

Reason 3: No attractive compensation package

Most MPS compensation packages give the rep the first month’s payment as their commission. That’s not exciting. Let me explain why.

They could sell a copier deal for $200 per month on a 60-month lease and make $1,000 in commission (when factoring in GP). You sell an MPS deal at $200 per month and you make $200. How exciting is that? It’s not. The dealership is making $7,200 on that deal over 36 months. There’s plenty of money here to make it more compelling for the salesperson to focus on.

I’ve seen compensation packages where that rep could make $600 on that same sale. Heck, I’ve seen compensation packages where the rep gets a brand new Mercedes lease, paid for by the company, for 12 months in the following year if they hit their annual MPS budget. There is no limit to the incentives your dealership should be using to get your salespeople on the MPS train. There is way too much profit in it to not dangle that carrot.

YOUR SOLUTION: Rethink your strategy on how to make selling MPS the most profitable service for your salespeople. The money is there. Get them excited about the potential.

Reason 4: No data strategy

If you want to sell a lot of MPS contracts, you need to know how to find the low-hanging fruit. You can find them by looking at the data of what devices are on your prospect’s network and how much they are printing on them. We can get the data by using print tracking software tools. Without them selling MPS becomes that much more challenging.

One of the sad realities out there is that some dealerships rely too much on their manufacturer’s solutions around capturing meter reads on their devices for accounting purposes. The problem with this solution is it only collects meter read data on their own models and ignores the rest of the customer’s network, and thus all the data needed for the MPS opportunity. Sure, it’s nice that the equipment collects their model’s meter reads, but it makes it that much more difficult to answer why you are also loading third-party print tracking software on their network. What is the reasoning? To capture data on the devices you’re not even managing? Yeah, that’s going to go over well with the customer.

The truth is you must be stubborn around your strategies with data collection. It’s not going to be easy to get your customers on board. It’s going to take a company-wide initiative to keep this strategy top of mind and constantly executing. The MPS revenues are worth it! At our dealership, we had strategies upon strategies about how to capture data intelligence on what was happening on our customers’ networks. We wanted to know about the models they were printing on, the volumes they were doing, the service they were experiencing. Our service technicians were trained on how to pitch it to customers. Our sales support teams had contests around which teams were responsible for the most new FM Audit installs. You need this information. You need all of it.

YOUR SOLUTION: Put together a company-wide initiative to load your data collection device. Explain the many benefits to your customers as well as the ways it could impact future sales.

Reason 5: GTM misalignment 

The final reason MPS programs fail centers around the go to market (GTM) strategy at the dealership. The GTM strategy comes from you. What do you want to sell at your dealership? What are you telling your salespeople is important to focus on day in and day out in their territory? If it’s not MPS, then that’s a problem. Don’t we already know that MPS drags copier equipment?

My favorite example of the right kind of alignment came from Terry Dixon. He’s the president, Direct Division of Konica Minolta Business Solutions. Back when he was in the Xerox channel he was a monster with MPS. Every day he demonstrated how important selling MPS was to his company. If a copier sale was done, he would publicly ask the salesperson, the sales manager and VP, “how much MPS did you add in the sale?” This became a daily occurrence. He made sure everyone knew that if there wasn’t MPS at the time of sale, then it wasn’t anything to celebrate. Selling MPS was the strategy. He even made a point to sell it himself when he went into the field on appointments.

Would you believe that there are salespeople in our industry making more than $1,000,000 per year? It’s true. I’d bet you could guess what solution they lead with.

YOUR SOLUTION: Decide what your go to market strategy is at your dealership. Is MPS just an extra offering? Or are you leading with it as your most important and impactful service for your customers?

Take control of your MPS opportunity

What could it mean to your dealership to have an additional monthly recurring revenue stream of $84,000 per month in MPS service passthrough?

When I left my dealership we were at $840,000 per month and we were barely scratching the surface of our potential. You can get there too. Just start by filling any holes you have in the top 5 reasons in this article and you’ll be well on your way to stealing more of that profit from HP Inc’s pocket and putting it inside your dealership where it belongs.

Derek Shebby
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Derek Shebby, the founder of Modern Sales Training, spent 17 years as a top sales executive and sales director with Xerox Corp. in California. During his tenure at Mr. Copy (MRC), he was a 13-time Sales President's Club Award winner, coached hundreds of salespeople and sales leaders to excellence, and helped grow his local division from $40 million to more than $100 million in annual revenue (30 to 500 employees). Now he spends his time raising his soon-to-be three boys in San Diego, California, while helping dealerships across the nation increase revenues and profits through his sales training courses, copier sales training program, and MPS Acceleration Workshop. He can be reached at derek@modernsalestraining.com and has exclusive content for The Imaging Channel subscribers at www.modernsalestraining.com/TIC

Derek Shebby

Derek Shebby, the founder of Modern Sales Training, spent 17 years as a top sales executive and sales director with Xerox Corp. in California. During his tenure at Mr. Copy (MRC), he was a 13-time Sales President's Club Award winner, coached hundreds of salespeople and sales leaders to excellence, and helped grow his local division from $40 million to more than $100 million in annual revenue (30 to 500 employees). Now he spends his time raising his soon-to-be three boys in San Diego, California, while helping dealerships across the nation increase revenues and profits through his sales training courses, copier sales training program, and MPS Acceleration Workshop. He can be reached at derek@modernsalestraining.com and has exclusive content for The Imaging Channel subscribers at www.modernsalestraining.com/TIC